Determinants of the voluntary adoption of digital reporting by small private companies to Companies House: Evidence from the UK

Abstract

This study examines the factors that influence the voluntary adoption of the digital reporting of the statutory accounts and returns to the company registry (Companies House) by small private companies in the UK. We analyse survey data from 343 members of the Association of Chartered Certified Accountants working in small companies or in practices with small company clients in the UK. The data is examined using statistical methods, mainly PLS-SEM. Our results show the following factors positively influence the voluntary adoption of digital reporting by small private companies: the relative advantage from standardisation benefits, the company's technology competence and support from top management. We also provide evidence that the complexity of the company's accounting system and technology costs inversely influence this voluntary adoption. The study contributes to the emerging literature by expanding our understanding of how the standardisation of financial information flows benefits small private companies. The results should be of interest to small companies and their accountants, regulators in the UK and other jurisdictions planning digital reporting initiatives or seeking to reduce administrative burdens on smaller entities.

Modelling the Asymmetrical Relationships between Digitalisation and Sustainable Competitiveness: A Cross-Country Configurational Analysis

“…Their studies indicate that the Tango government should enhance the affordability of digital technologies to citizens in order to achieve digitalisation goals. In terms of innovation and the business environment, some studies mention a range of business antecedents essential for digital transformation (Alkhatib et al 2019;Basole and Patel 2018;Bouwman et al 2019;Pradhan et al 2019aPradhan et al , 2019b. Arora and Rathi (2019) assert that in India, business environment factors such as diversification, profitability, level of competition, and managerial factors have immense influence on the adoption of digitalisation.…”

Resilience and Economic Intelligence Through Digitalization and Big Data Analytics

“…Furthermore, Alkhatib et al (2019) investigate the factors that can influence the voluntary digital reporting to Companies House by small companies in the UK as in 2005 the UK government implemented two different digital reporting initiatives for these companies. The results show that the technology competences that a company has, the relative advantage that comes from standardization benefits and support from top management are the factors that positively influence voluntary digital reporting.…”

Role and contribution of administrative accounting to small and very small businesses

“…Proper cost benefit analysis and information on technical knowledge are necessary for small firms in order to supervise their respected digitized methods. However, it is evident that top management support is crucial for overcoming eminent digital reporting obstacles (Alkhatib et al, 2019). For example, third-party professionals could collaborate in order to improve a small firm's productivity regarding tax processes (Efobi et al, 2019).…”